Some key points and information that cryptocurrency traders must know: 1. The Federal Reserve cut interest rates by 25 basis points as scheduled in the early morning of the 11th, and Bitcoin ETH did not rise but fell, which is in line with expectations: good news landed but bad news, and everyone sold to cash in. Is that going to leave soon, bear? There's nothing else to play with? That's not true either. Don't worry, The Federal Reserve has secretly released water! Announce the launch of RMP on December 12th What is RMP? English full name: Reserve Management Purchases Meaning: Reserve management purchase. The Federal Reserve is a technical operation to maintain sufficient reserves in the banking system by purchasing short-term treasury bond. The purpose is to prevent liquidity tension in the money market. 2. Reserve management purchase: buy short-term treasury bond to replenish reserves for the banking system to prevent money shortage), the first installment of 40 billion dollars, and start buying tomorrow (December 12)! This wave of operations is very similar to the "Not QE" of 2019, and the market wants to relive the "beautiful memories of 2019". So, why start RMP now? QT (Quantitative Tightening, with over 2 trillion yuan in losses over the past three years) has just ended on December 1st, and reserves have reached the brink of being "sufficient but fragile". At the end of November, SOFR (overnight borrowing cost for banks) was fluctuating, and the REPO market was under great pressure. The Federal Reserve was afraid of a repeat of the 2019 repo crisis and needed to quickly replenish funds to prevent the explosion. Also in time for the big blood draw during the tax season in April next year, vaccination is mandatory! Noun Explanation: QT full name: Quantitative Tightening Meaning: Quantitative tightening. In contrast to QE, the Federal Reserve recovers liquidity and tightens monetary policy by reducing its balance sheet (by not renewing maturing assets or actively selling them). Full name of SOFR: Secured Overnight Financing Rate Meaning: Guaranteed overnight financing rate. The main benchmark interest rate in the US money market reflects the cost for banks to borrow overnight with high-quality collateral such as treasury bond bonds. REPO full name: Repurchase Agreement, also known as repurchase agreement Mr. Powell said firmly, 'This is not QE! QE is a powerful remedy, buying long-term bonds to stimulate the economy.'. ”RMP only buys short-term T-bills (<1 year, almost 0 duration), pure technical work, stable short-term interest rates, and does not lower long-term borrowing costs. Small scale (40 billion yuan in the first month, accounting for only over 0.1% of GDP), can coexist with high interest rates. QE Full name: Quantitative Ease Meaning: Quantitative easing. The central bank buys long-term treasury bond, MBS and other assets on a large scale, injects liquidity into the economy, lowers long-term interest rates, and stimulates economic growth (typically used in crisis periods). His intention is very clear: I am just gently turning on the faucet to drip a few drops of water into the market now ， Let the fish not die of thirst. It's still far from the time to turn on the faucet and flood the water! 3. But those who speculate in cryptocurrency understand that once liquidity loosens, risky assets will be at risk first! After the announcement, the US dollar fell, US bond yields fell, technology stocks rose, and gold and silver pulled up. The wave of RMP in 2019, asset frenzy for half a year! Now the economy has not deteriorated to the level of QE (inflation is still stuck, employment is stable), RMP is low-key enough to replenish water, and it is not criticized for "excessive water release", perfect for invisible easing 4. This operation undoubtedly brings short-term benefits to encryption, commodities, and the stock market. A short-term rebound is not a big problem, but high interest rates are still high, and the expectation of interest rate cuts in 2026 has changed from two times to once, so the overall bull market is almost on the verge of being ignited. In summary, this is the Fed's usual approach - "stabilizing the market+releasing small amounts of money", not the trillion dollar QE frenzy of 2020. So, let's lower our leverage, strike steadily, and take advantage of the situation. When the market FOMO occurs, run away; when the market panics, enter.